DIC sells stake in $300m Mena fund

Dubai, August 27, 2012

Dubai International Capital (DIC), the private equity arm of Dubai Holding which restructured $2.5 billion debt in April, sold its stake in a $300 million Middle East North Africa infrastructure fund to Islamic investment firm Fajr Capital.

Fajr, which is backed by prominent investors such as Abu Dhabi Investment Council and Malaysia's state investor Khazanah Nasional Berhad, will manage the fund along with its two other partners HSBC Holdings and Waha Capital, it said in a statement on Monday.

All the three partners will have equal ownership stake in the fund post the deal, one source familiar with the matter said.

The Mena Infrastructure Fund was formed in 2007 to invest in infrastructure and energy projects in the Middle East and North Africa. At the time of launch, the three sponsors of the fund had committed $50 million each as initial investment.

The fund has investments in Alexandria International Container Terminals (AICT) and Muscat-listed United Power Co, according to its website.

DIC, a unit of the conglomerate owned by the emirate's ruler, aims to raise more than $150 million from asset sales in 2012, its chief executive said in April.

It sold hotel operator Ishraq Dubai to Almulla Group in October last year and exited its 45-percent stake in valve maker KEF Holdings.

The firm, which was hard hit during the financial crisis due to use of excessive leverage in its investments, had to hand over its ownership of UK budget hotel chain Travelodge as part of a debt restructuring deal.

Fajr Capital has $700 million in committed capital, it said in the statement. - Reuters